The Productivity Of Information Technology
...December, 1991
This research was sponsored by the MIT Center for Coordination Science, the MIT
International Financial Services Research Center, and the Sloan Foundation. Special
thanks are due Michael Dertouzos and Tom Malone for encouraging me to pursue this
topic as part of a study group at the MIT Laboratory for Computer Science. I would like
to thank Ernie Berndt, Geoffrey Brooke, and Chris Kemerer for valuable comments and
Marshall Van Alstyne and Peter Perales for excellent research assistance. Only I am
responsible for any remaining deficiencies
The Productivity of Information Technology:
Review and Assessment
Erik Brynjolfsson
Abstract
Productivity is the bottom line for any investment. The quandary of information
technology (IT) is that, despite astonishing improvements in the underlying capabilities of
the computer, its productivity has proven almost impossible to assess. There is an
increasing perception that IT has not lived up to its promise, fueled in part by the fact that
the existing empirical literature on IT productivity generally has not identified significant
productivity improvements. However, a careful review, whether at the level of the
economy as a whole, among information workers, or in specific manufacturing and service
industries, indicates that the evidence must still be considered inconclusive. It is premature
to surmise that computers have been a paradoxically unwise investment. A puzzle remains
in the inability of both academics and managers to document unambiguously the
performance effects of IT. Four possible explanations are reviewed in turn:
mismeasurement, lags, redistribution and mismanagement. The paper concludes with
recommendations for investigating each of these explanations using traditional
methodologies, while also proposing alternative, broader metrics of welfare that ultimately
may be required...
View Full Essay
